Picking a winning trade on a consistent basis is not simply a stroke of luck. It’s the result of calculated screening, planning, and deliberation.
With this in mind, we have started a new weekly series on our top 10 stocks to watch this week — stocks that look poised for a possible breakout in the coming days. Traders should add these stocks to their watchlist now.
The Top 10 Stocks to Watch This Week for Possible Breakouts
| Sl # | Name of the Stock | Stock Ticker | Last Close | Buy Level(s) | Reason |
| 1 | Noble Midstream Partners LP | NASDAQ: NBLX | $13.30 | $13.60 | Ascending Triangle Pattern |
| 2 | Royal Bank of Canada | NYSE: RY | $83.52 | $87.00 | Rising Wedge Pattern |
| 3 | Boston Scientific Corporation | NYSE: BSX | $38.96 | $42.20 | Ascending Triangle Pattern |
| 4 | Tradeweb Markets Inc. | NASDAQ: TW | $65.00 | $69.00 | Ascending Triangle Pattern |
| 5 | Skechers U.S.A., Inc. | NYSE: SKX | $37.25 | $39.00 | Uptrend Channel |
| 6 | TG Therapeutics, Inc. | NASDAQ: TGTX | $54.30 | $57.00 | Flag Pattern Breakout |
| 7 | Planet Fitness, Inc. | NYSE: PLNT | $77.79 | $84.00 | Ascending Triangle Pattern |
| 8 | DHT Holdings, Inc. | NYSE: DHT | $5.97 | $6.30 | Consolidation Area |
| 9 | SelectQuote, Inc. | NYSE: SLQT | $24.95 | $26.00 | Uptrend Channel |
| 10 | American Superconductor Corporation | NASDAQ: AMSC | $24.67 | $31.00 | Flag Pattern |
Important: Typically, these trades offer a risk: reward ratio of 1:2 or 1:3 in the next 6 months, which implies 2x to 3x rewards when compared to risks. So, be sure to set your stop-loss levels and target prices accordingly to manage your risk. In addition, these trade ideas are triggered using daily closing prices, not intra-day pricing. So, if you participate in these trades, make sure that you only buy the stock once its daily close is above the recommended price level.
That said, here are the top 10 stocks to watch for a breakout, in no particular order.
#1 Noble Midstream Partners LP (NASDAQ: NBLX)
Sector: Energy | Oil & Gas Midstream
Reason: Formation of an Ascending Triangle Pattern
An ascending triangle pattern is a bullish pattern formed by drawing a horizontal line along the swing highs, and a rising trendline along the swing lows. These two lines result in the formation of a triangle. A breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for NBLX is if the stock has a daily close above the breakout level of the ascending triangle pattern, at around $13.60. This is marked in the chart below as a green color dotted line.
Daily chart – NBLX
NBLX – Ascending Triangle Pattern
#2 Royal Bank of Canada (NYSE: RY)
Sector: Financial | Banks – Diversified
Reason: Formation of a Rising Wedge Pattern
A rising wedge pattern is formed by the two converging trend lines when the price of the stock rises over a certain time period. This is typically considered a bearish pattern. However, a breakout from the upper rail of a rising wedge pattern is usually considered a bullish sign.
Buy Level(s): The ideal buy level for RY is above the breakout level of the Rising Wedge Pattern. This translates to a price of around $87.00. This is marked in the chart below as a green color dotted line.
Daily chart – RY
RY – Rising Wedge Pattern
#3 Boston Scientific Corporation (NYSE: BSX)
Sector: Healthcare | Medical Devices
Reason: Formation of an Ascending Triangle Pattern
An ascending triangle pattern is a bullish pattern formed by drawing a horizontal line along the swing highs, and a rising trendline along the swing lows. These two lines result in the formation of a triangle. A breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for BSX is if the stock has a daily close above the breakout level of the ascending triangle pattern, at around $42.20. This is marked in the chart below as a green color dotted line.
Daily chart – BSX
BSX – Ascending Triangle Pattern
#4 Tradeweb Markets Inc. (NASDAQ: TW)
Sector: Financial | Capital Markets
Reason: Formation of an Ascending Triangle Pattern
An ascending triangle pattern is a bullish pattern formed by drawing a horizontal line along the swing highs, and a rising trendline along the swing lows. These two lines result in the formation of a triangle. A breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for TW is if the stock has a daily close above the breakout level of the ascending triangle pattern, at around $69.00. This is marked in the chart below as a green color dotted line.
Daily chart – TW
TW – Ascending Triangle Pattern
#5 Skechers U.S.A., Inc. (NYSE: SKX)
Sector: Consumer Cyclical | Footwear & Accessories
Reason: Formation of an Uptrend Channel
An uptrend channel or an ascending channel is the price action contained between upward sloping parallel lines. It is formed by a lower trend line that connects the swing lows, and an upper channel line that joins the swing highs. A stock usually trades between the two rails of the uptrend channel before finally breaking out from the upper rail.
Buy Level(s): The ideal buy level for SKX is if the stock has a daily close above the breakout level of the uptrend channel, at around $39.00. This is marked in the chart below as a green color dotted line.
Daily chart – SKX
SKX – Uptrend Channel
#6 TG Therapeutics, Inc. (NASDAQ: TGTX)
Sector: Healthcare | Biotechnology
Reason: Breakout From a Flag Pattern
A flag pattern is a short-term continuation pattern that marks a small consolidation before the previous move resumes. The pattern is formed when the market consolidates in a narrow range after a sharp move. For a stock in an uptrend, a breakout from this pattern is typically a strong bullish indication.
Buy Level(s): Although the stock has currently broken out of the flag pattern, the ideal buy level for TGTX is above the near-term resistance level of $67.00. This is marked in the chart below as a green color dotted line.
Daily chart – TGTX
TGTX – Flag Pattern Breakout
#7 Planet Fitness, Inc. (NYSE: PLNT)
Sector: Consumer Cyclical | Leisure
Reason: Formation of an Ascending Triangle Pattern
An ascending triangle pattern is a bullish pattern formed by drawing a horizontal line along the swing highs, and a rising trendline along the swing lows. These two lines result in the formation of a triangle. A breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for PLNT is if the stock has a daily close above the breakout level of the ascending triangle pattern, at around $84.00. This is marked in the chart below as a green color dotted line.
Daily chart – PLNT
PLNT – Ascending Triangle Pattern
#8 DHT Holdings, Inc. (NYSE: DHT)
Sector: Energy | Oil & Gas Midstream
Reason: Formation of a Consolidation Area
A Consolidation Area is a price action contained between two parallel lines. It is formed by a lower line that connects the lows, and an upper line that joins the highs. A stock usually trades between the two lines of the consolidation area before finally breaking out from the upper rail.
Buy Level(s): The ideal buy level for DHT is if the stock has a daily close above the breakout level of the consolidation area, at around $6.30. This is marked in the chart below as a green color dotted line.
Daily chart – DHT
DHT – Consolidation Area
#9 SelectQuote, Inc. (NYSE: SLQT)
Sector: Financial | Insurance Brokers
Reason: Formation of an Uptrend Channel
An uptrend channel or an ascending channel is the price action contained between upward sloping parallel lines. It is formed by a lower trend line that connects the swing lows, and an upper channel line that joins the swing highs. A stock usually trades between the two rails of the uptrend channel before finally breaking out from the upper rail.
Buy Level(s): The ideal buy level for SLQT is if the stock has a daily close above the breakout level of the uptrend channel, at around $26.00. This is marked in the chart below as a green color dotted line.
Daily chart – SLQT
SLQT – Uptrend Channel
#10 American Superconductor Corporation (NASDAQ: AMSC)
Sector: Industrials | Specialty Industrial Machinery
Reason: Formation of a Flag Pattern
A flag pattern is a short-term continuation pattern that marks a small consolidation before the previous move resumes. The pattern is formed when the market consolidates in a narrow range after a sharp move. For a stock in an uptrend, a breakout from this pattern is typically a strong bullish indication.
Buy Level(s): The ideal buy level for AMSC is if the stock has a daily close above the breakout level of the flag pattern, at around $31.00. This is marked in the chart below as a green color dotted line.
Daily chart – AMSC
AMSC – Flag Pattern
Happy Trading!
Trades of The Day Research Team